Why is comparative advantage rather than absolute advantage the basis for trade?
What will be an ideal response?
The concept of comparative advantage emphasizes the efficiency of production, measured by the opportunity cost of expanded production of some good. If a country has a comparative advantage in something, it is able to increase production of it at lower opportunity cost, and will therefore give up less of other things as it expands output. As such, it is the least inefficient in production.If every nation specializes where each has a comparative advantage, then each gives up the least as it expands output of a product. This is the lowest (opportunity) cost method of increasing output. If every other nation imports from nations that have a comparative advantage in production, that is a lower (opportunity) cost way to obtain the goods than trying to produce the goods domestically.The emphasis in the analysis is on opportunity cost and on increasing production (for consumption) as efficiently as possible.
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Refer to the information provided in Figure 8.3 below to answer the question(s) that follow. 
Figure 8.3
Refer to Figure 8.3. The marginal cost of the eleventh basketball is
A. less than $1. B. $1. C. $2. D. greater than $2.
Based on the data in the table above, what is the value of M1?
A) $2,950 billion B) $1,361 billion C) $752 billion D) $609 billion
The nominal cost per unit of output rises when production is pushed beyond an economy's potential output
a. True b. False Indicate whether the statement is true or false
Which of the following would be an excellent example of a lumpy input
a. pancake griddles b. water c. labor d. corn e. pancake batter